expansion

Global M&A Trends: Expansion and Internationalization

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December 5, 2013

Globally M&A dealmaking was down in October both in volume and number of deals, according to the Merrill Monthly M&A Insider report published in November. But some regions are showing robustness. For example, China Daily reports  that a drive towards internationalization is underlying M&A activity in China, positioning China to overtake Japan as the leading country doing overseas M&A this year.

According to the newspaper report, Chinese companies have made USD 56.2 billion in overseas M&A deals, led by Shuanghui International Holdings’ USD 7.1 billion purchase of Smithfield Foods Inc. Deals mentioned were mainly in the US.  The trend looks set to increase in the coming year due to political will and directives.

Elsewhere, Reuters reports that companies expect a 17 percent rise in mergers and acquisitions activity next year that would push global deal volume to its highest level since 2008, citing a survey done by Thomson Reuters and Freeman Consulting Services.

The driver of the uptick in dealmaking is expansion and transformative acquisitions, which is a shift from today’s M&A driven by getting rid of non-core assets and bargain hunting for undervalued companies and assets.

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